Prices of home appliances, including LED TVs, refrigerators and washing machines, are likely to go up by about 10 per cent in the new year. Rising prices of raw materials like copper, aluminium and airway and waterway freight rates are expected to push up the price.
According to manufacturers, retailers around the world have doubled the number of TV panels (open-cell) due to low supply. Also, rising crude oil prices have pushed up the price of plastics. Stating that a price hike is inevitable and necessary, companies like LG, Panasonic and Thomson will raise prices from January, while Sony will increase the price by analysing the situation.
Manish Sharma, President and CEO, Panasonic India, said, “The rise in raw material prices could have an impact on the prices of our products soon. Prices are expected to rise by 6 to 7 per cent in January and by 10 to 11 per cent by the end of the financial year.
LG Electronic India is also planning to increase the prices of appliance category products by 7 to 8 per cent from January 1. Regarding this, Vijay Babu of LG Electronic India VP-Home Appliances said, “Since January, we have been increasing the prices of all products like TVs, washing machines, refrigerators by 7 to 8 per cent.” Prices of raw materials, as well as copper and aluminium, have risen. The decision was taken due to the rise in crude oil prices and the rise in plastic prices.
Sony India is still in the role of wait and watches on price rise. Although a final decision has not yet been made, the company has indicated that it is moving in that direction. Asked about the price, Sony India managing director Sunil Nayyar said, “Not yet.” Wait and Watch is currently underway. We are looking at the supply side which is changing day by day. The current situation is unclear. The price of TV panels has gone up. Prices of other raw materials have also gone up. We mainly focus on demand and supply. Work from home has increased the demand for products. Supply is limited as the factory is not operating at full capacity. “This has created a void in the supply sector and pushed up prices,” Nayyar said. The storm situation was prepared due to supply disruption, increase in demand and other problems.
There is also a problem with the big screen but I don’t think they are very large. Nayyar said the 32-inch screen is still in high demand in the Indian market. French electronics brand Thomson and Kodak brand licensee’s Super Plastronics have said that there is a shortage of TV open-cell in the market and its price has increased by almost 200 per cent. The price of the panel has gone up by 200 percent and the supply is low. We are dependent on China as there is no alternative to panel production globally. The prices of Thomson and Kodak Android TVs will increase by 20 per cent from January, said Avneet Singh Marwah, chief executive officer of SPPL. Arjun Bajaj, a director of Videotex International, said the price hike was due to a three-fold increase in import freight rates compared to October 2020.
A 20 to 25 per cent increase in raw material prices, a 6 to 7 per cent increase in water and air freight rates due to shortage of containers, and mining problems due to coronavirus are putting pressure on the input prices of products. As a result, the price of brands is expected to increase by 8 to 10 per cent. That could hamper demand in the next quarter, said Kamal Nandi, president of CREAM and business head and executive vice president of Godrej Appliances. According to Nayyar, the situation is not long-lasting. But, the pressure for the industry will continue in the first half of next year. The Indian appliance and consumer electronics industry is mainly dependent on China for imports of certain components. According to a joint report by CEAMA and Frost & Civilian, the total market share of these industries in 2019-20 was Rs 76,400 crore, of which domestic products accounted for Rs 2,200 crore.